Spar International, the Netherlands-based+ retailer, is looking to further expand in Africa, the company’s managing director has revealed.
The company, which is the third-largest retailer in South Africa and had stores in four other African nations, is looking to beef up its presence in the southern part of the continent, Dr Gordon Campbell, said.
Spar already has stores in Botswana, Zambia, Zimbabwe and Namibia but wants to boost its distribution muscle in the region, Campbell said.
“Spar in South Africa also operates stores in Namibia and Botswana with independent retailers but we distribute to Namibia and Botswana out of a Johannesburg warehouse – round-trips of 2-2,500 kilometres,” Campbell said. “We’re now looking at the possibility of a distribution centre in Namibia. The problem is not us building a distribution centre but supplying products into it from suppliers.”
The retailer is also lining up an entry into Nigeria, Campbell revealed. “Our aim is to be a major food retailer in all of those southern Africa countries and also in Nigeria later this year,” Campbell told the Retail Week Conference 2009 in London yesterday (18 March).
International expansion remains key to Spar’s plans to grow its business and the company works with local retailers in each market.
Campbell said rising populations in the world’s developing economies, combined with migratory shifts from rural to urban areas, meant international expansion was attractive to Spar, particularly in China, India and Russia.
Spar is present in Chinese provinces, including Shandong and Hubei, and its stores can reach a combined population of 360 million people, Campbell said.
“They are provinces that are regarded as second-tier in China, so the major international retailers haven’t really gone in there as of yet. We’re working to the regional Chinese retailers up to a high standard,” Campbell said.
In Russia, Spar works with six partners and has 177 stores. However, Campbell said Spar had put off a plan to open its first hypermarket in Russia to next year due to the global economic turmoil.
Elsewhere, Campbell described India as “an extremely difficult market” but said Spar’s local venture would look top open a 100,000 square foot hypermarket in Bangalore in May.
He also maintained the venture’s plans to have seven outlets open by the end of the year.